Oil prices recovered modestly but remained below $70 in Asian trade on Thursday after overnight losses on US energy demand concerns, analysts said.

New York's main contract, light sweet crude for August delivery was 14 cents firmer at $69.45.

Brent North Sea crude for August delivery rose 10 cents to $68.89 a barrel.

Crude fell at the close of US trading on Wednesday as investors focused on weak American gasoline demand indicated by the latest government data which showed petrol stocks rising by 2.3 million barrels in the week ending June 26.

Distillates, which include diesel and heating fuel, increased by 2.9 million barrels in the same period, the data released by the US Department of Energy on Wednesday showed.

Gasoline demand traditionally increases at this time of the year when Americans take to the roads for their summer holidays but the recession that began late last year is still taking a toll on US consumers, analysts said.

"Product demand is simply awful. Products built more than expected, and the expectations were already bearish," said Hussein Allidina of Morgan Stanley Research.

Going forward, the direction of crude prices will continue to be heavily influenced by the state of the global economy, especially that of the United States, the world's biggest energy user, analysts said.